We've heard rumors and gotten questions about whether the iPad 2 gains any GPS functionality when tethered to an iPhone 4 and, based on our tests (see the video above) -- yes it does, albeit a little dumbed-down. GPS functionality seemed to be working in both Maps and Navigon, but it clearly doesn't work half as well as the 3G enabled iPad with assisted GPS built-in. Still, if you've decided on purchasing the 3G enabled iPad 2 primarily for its GPS capability, you may want to consider tethering an iPad Wi-Fi to iPhone 4 as an option.

Keep in mind the test was conducted on an iPhone 4 running iOS 4.2.1 using MyWi to create a wireless hotspot, however the results should be the same when using an AT&T or Verizon iPhone 4 (running iOS 4.3 or 4.2.6 respectively) with the Personal Hotspot feature baked-in. Results should be similar on the original non-3G iPad as well, and make sure you have location services enabled on both devices for it to work properly.

So although this technically works, we wouldn't suggest using it as a full in-dash GPS unit by any means. If you want to do things like location-aware tweets it should work like a charm by roughly pinpointing your location when Wi-Fi router mapping isn't an option.

If you have a Wi-Fi-only iPad then pair it up with your iPhone 4 and let us know how it's working for you in the comments below!

Andrew Wray is a Salt Lake City, Utah based writer who focuses on news, how-tos, and jailbreak. Andrew also enjoys running, spending time with his daughter, and jamming out on his guitar. He works in a management position for Unisys Technical Services, a subsidiary of Unisys Corporation.

I have my doubts that this works like you explained especially since you used MyWi instead of the stock hotspot feature included in iOS 4.3. What the iPad is most likely doing is using Wifi hotspots that are in range and figuring out it's location. However I could be wrong.

iOS doesn't sniff for Wi-Fi networks when 'Ask to Join Networks' is disabled in settings. The personal hotspot feature in 4.3 works no different than how MyWi (or TetherMe) broadcasts a Wi-Fi network from your device, so results would be identical when using the iOS 4.3 hotspot feature paired to an iPad.
Also, if 'Ask to Join Networks' had been enabled, we were moving too fast for the iPad to be able to pick up on Wi-Fi networks we were passing through, so I'm confident that wouldn't have any impact on the results if that were the case.
I do agree that the test isn't 100% straight-forward given the difference in FW versions, but that shouldn't be detrimental to the results given the technical similarities in how the mobile hotspot function works at the system level. The results would be the same.

Tethering via Bluetooth actually is more of a power drain for both devices because that is one more radio on also the data floe is much slower and location data demands more data so inorder for the iPhone to give more data for the location to work on the iPad it needs to fun much faster inorder to get the data across threw the smaller bluetooth pipes. Also I don't think that bluetooth tethering would work I have not tried it.

Actually this works with any phone that can thither via WiFi I did it all the time with my Nokia phone and my iPod Touch. Basically what happens is that is that your WiFi only devices iPad or iPod or what ever sees the iPhone or other phone as a router and gets the location data the same-way it would if you would be at home but with the cellular data not the aGPS data aGPS does not get transfered when you thither the data from the phone.
The phones data could be transferred to the to the iPad in this case but not fast enough to be more accurate than 3G to WFI data witch includes location data not aGPS data.

Sorry guys, I went out and did some extensive testing and this is simply just Wi-Fi location and definitely not GPS.
If you want to try something for a quick test, while at home, load up maps on your iPad and find your location. Now head out in the car WITHOUT tethering. Guess what? It will periodically, and not-very accurately update your location as you drive around your neighborhood. It will do this even if 'Ask to Join' is disabled. In fact it will update just like it does when tethered - (as often and in the same locations).
You can read the details of my tests, including testing tethered to an iPhone 4 in a Wi-Fi dead zone and disabling Wi-Fi and tethering via Bluetooth on my blog:http://johnmarshall4.tumblr.com/post/4061084217/debunking-the-wi-fi-only...